Gold prices remained under pressure as a surge in global risk appetite kept demand for safe-haven assets muted. Investors shifted focus to equities and other riskier assets, dampening gold’s appeal ahead of the pivotal US Consumer Price Index (CPI) report, which could shape expectations for Federal Reserve policy.
The metal has struggled to gain traction in a market dominated by optimism surrounding economic resilience and easing recession fears. A stronger risk-on sentiment, coupled with a steady dollar, has left gold vulnerable to further downside. However, traders remain cautious as the upcoming CPI data could reignite concerns about inflation and monetary tightening.
If the CPI reading signals persistent inflationary pressures, it could bolster the case for higher interest rates, adding pressure to non-yielding assets like gold. Conversely, a softer-than-expected report might provide a lifeline for the metal, as traders recalibrate expectations for Fed action.
With the gold market caught between conflicting signals, its near-term trajectory depends heavily on how the CPI data impacts broader market sentiment and interest rate outlooks. Until then, gold remains subdued as traders await clearer direction.
